As income polarization in the United States deepens, the luxury hotel market appears to be enjoying its best boom on record. Despite overlapping headwinds such as an economic slowdown, a decline in foreign tourists, and a reduction in office jobs, wealthy travelers are seen as opening their wallets.
On the 11th, the Wall Street Journal (WSJ) reported that demand for high-end accommodations in the United States has surged this year, pushing room rates to a record high. According to the market research firm CoStar, the average daily room rate at U.S. luxury hotels this year is $394 (about 580,000 won), which is $168 more expensive than hotels one tier below.
From January to September this year, the booking rate for high-end accommodations such as beachfront resorts and upscale urban hotels was 2.5% higher than the baseline year, while demand for mid- to low-priced hotels was tallied to have declined slightly.
In particular, price increases appear steeper at "ultra luxury" hotels. According to CoStar, the average nightly rate at luxury hotels in France is around $1,000, while ultra luxury hotels exceed $2,600. In New York as well, standard luxury hotels average $472, and ultra luxury hotels average $1,560, it was found.
Experts said affluent consumers are investing more in travel with their families, beyond material consumption such as luxury cars and watches. Albert Herrera, a vice president at the travel services corporations Internova, said, "They want villa-level low-rise apartment and yachts beyond two-bedroom suites," adding, "Ultra luxury facilities are keeping the industry afloat."
Amid surging demand, luxury hotel chains have embarked on aggressive expansion. Montage International, which operates luxury hotels and resorts, currently runs 15 hotels and plans to double its locations within three to five years. Alan Fuerstman, Montage chief executive officer (CEO), said, "Most guests will be Americans," adding, "This year's revenue rose 8% from a year earlier, and group bookings for 2026 are increasing to record high levels."
Some chains have hit a wall of slowing profitability due to the global economic slowdown, trade uncertainty, and rising prices, but they are recouping losses by focusing on the U.S. market.
For example, Corinthia Group, which owns 12 hotels, reopened the Surrey Hotel in Manhattan, New York, last year, and charges at least $2,000 per night on weekends in December. All rooms offer dedicated butler service, and a high-end Italian restaurant is operated as a members-only space. Staff are trained to ▲ open the car door within 15 seconds of the vehicle's arrival ▲ answer before the phone rings more than three times ▲ and remember the guest's name.
Simon Casson, CEO of Corinthia, explained, "Service that anticipates and acts on customer needs ultimately translates into higher room rates."
Meanwhile, the economic sentiment of U.S. consumers recently deteriorated to the "worst" level in three years. On the 7th, the University of Michigan said the preliminary reading of the consumer sentiment index, which reflects U.S. consumers' confidence, was 50.3 in Nov., down 3.3 points from the previous month. This is the lowest reading since June 2022 (50.0), when inflation fears peaked.
Joanne Hsu, the survey director, said, "This month's decline in sentiment was broad-based regardless of age, income, or political orientation," adding, "With the federal government shutdown (temporary halt of operations) dragging on for more than a month, consumer economic sentiment appears to have been dampened."